Impact of IT Systems on Business Operations

The provided report is a detailed analysis of the impact of implementing IT systems on business operations. The assignment discusses how various IT systems, such as Transaction Processing System (TPS) and Decision Making System (DSS), can be used in different departments to improve efficiency and productivity. It also examines how these systems can help solve common business problems like problem-solving and resistance to change. The report concludes that implementing IT systems is essential for improving overall business operations and achieving goals effectively.

Business Information
Technology Systems

TABLE OF CONTENTS
INTRODUCTION:..........................................................................................................................1
TASK 1............................................................................................................................................1
P1 How IT systems are used in different business functions......................................................1
P2 How IT system contributes in achieving goals of Johnson Super market.............................2
M1 How IT system apply in different functions of organisation................................................3
TASK 2............................................................................................................................................3
P3 Different ways in which IT system process data...................................................................3
M2 Analyse how IT system store and process data....................................................................4
TASK 3............................................................................................................................................5
P4 How IT system supports changes within organisation..........................................................5
M3 Advantage and disadvantage of IT system...........................................................................5
TASK 4............................................................................................................................................6
P5 IT solutions for common business problems.........................................................................6
M4 How IT system add value to business problem....................................................................7
CONCLUSION:...............................................................................................................................7
REFERENCES:...............................................................................................................................8

INTRODUCTION
In present era, Information Technology (IT) is a basic need of every organisation.
Implementation IT system in different functions helps in integrating all activities to be completed
in an effective manner. It manages and controls business operations in an efficient way. These
systems bring modifications in overall business operations thus by changing process and
procedures. It is useful in improving productivity and performance of employees. This report
shows the ways in which IT systems are implemented in different business functions. Also, it is
shown about the manner they store and process data to provide useful information. In addition to
this, how implementing IT systems increases business performance is discussed (Avgerou and
Walsham 2017). Furthermore, how business problems are being solved by system is shown.
For present assignment, firm taken is Johnson supermarket. The cited firm
belongs to retail sector and operates in the UK. The existence of company on large level requires
proper IT systems to operate effectively. Thus, this report will brief about some IT systems that
can be implemented by firm.
TASK 1
P1 How IT systems are used in different business functions
In a business common departments are sales, production, finance and human resource.
The activities performed by them are integrated to achieve business goals and objectives.
HRM- An effective IT system will be useful in measuring performance of employees. It helps in
providing training to them to enhance their skills and abilities. This will help in improving their
efficiency in completing a task. Also, it provides HR manager a software to maintain record of
each employee.
R&D- IT plays a major role in doing R&D. It helps business in identifying opportunities to grow
and develop. This brings innovation in process and procedure to accomplish goals in an effective
way (Aykin 2016). Also, it helps in competing in market as new technology increases business
functions efficiency.
MIS- Management Information System allows business to store and process data of every
operation that occurs. It provides effective information to management in decision making
process.
1

Marketing- IT systems are mostly used in marketing activities as it provides data related to
market conditions and products and services available in market. It helps in developing
marketing mix plan that includes price, place, etc. Moreover, it provides data related to response
of customer towards each promotion activity. With this, sales forecast can be made which helps
in estimating profits (Boud, Cohen. and Sampson 2014).
Production- IT system brings new tools and techniques of producing a product. It modifies the
entire production system and improves product quality. By implementing IT system, automated
production system can be developed that will produce goods in quick time with more efficiency.
Finance- Implementation of IT system will help in recording and maintaining every business
transaction. This will be useful in calculating profits and losses. Moreover, it identifies areas
where excess losses are been created and helps in controlling or reducing them. Along with this
resources can also be managed and allocated to departments. By analysing past data, budget is
made that helps business to measure its growth.
Therefore, implementing IT systems in different business functions helps in improving
business operations. It modifies overall organisational process and system that helps in bringing
efficiency in operations (De Haes and Van Grembergen 2015).
P2 How IT system contributes in achieving goals of Johnson Super market
The efficiency of business operations can be enhanced by implementing IT systems
according to the requirement of business. It is important to bring innovations in process to
maintain competition in the market. This transforms production system in manufacturing goods
with less resources and time. It also reduces cost per unit and increases profits. This enables
business to achieve goals and objectives in more effective manner. Therefore, manager use these
systems to analyse and measure data to develop strategies. It helps in enhancing skills and
abilities of employees to improve their working efficiency. This also integrates strategies of each
function so that common goals can be achieved.
Business decision- The entire functioning of business depends upon how managers take
decisions. These decisions are based on information that is provided by IT systems. It helps in
setting goals and objectives of department by measuring their performance. Also, it provides
2

flexibility in decisions by allowing managers to take alternative actions with change in situation.
It enables business to deal with circumstances thus maintaining its productivity (.Jones 2014).
IT systems create an innovative environment in which employees are able to work with
creative areas. This enables them to adopt new methods or process that leads to increase in
efficiency. For example- data and information collected by finance department will allow
managers to develop budgets. With available resources managers will allocate them to
departments. Apart from this, the production and marketing department will develop their goals
and strategies. Hence, forecasting sales and profits will help Johnson super market to increase
efficiency in their operations (Liebowitz and Frank 2016). For example- if DSS is implemented
in cited firm; it will allow manager to take decision by analysing market situation. Also, the
overall operations will be improved as there will be proper information system.
M1 How IT system apply in different functions of organisation
IT system helps production department to enhance productivity so that demand can be
met and also cost per unit can be reduced. This will maximise profits and faster production of
goods. In HR, it will measure employee performance and according to this it will provide
training methods to improve their skills. It will be beneficial in promoting and advertising
products by developing marketing strategies. Moreover, it provides budget by forecasting sales
and revenues.
TASK 2
P3 Different ways in which IT system process data
In small scale enterprises information is very useful in developing strategies and
improving operations. For this a proper IT system is needed to store and process data so that
effective information can be gained from it. There are various information systems that are
suitable for small business. These are discussed below:-
Transaction Processing System (TPS) - A transaction is related to sale or purchase of a good or
service. Business is entirely dependent on how these transactions are recorded and maintained so
that profit or loss can be calculated. TPS stores and process data on real time basis and provided
information whenever needed (Liggins, Hall, and Llinas 2017). Data is stored in a database with
high security measures. If a transaction happens, it is entered in system through which it goes to
the database where it is stored. This is useful in maintaining customer relationship management
3

and helps in solving their problems. Moreover, it stores data of each department so that their
performance can be measured. It is mostly used in purchase department where inventory data is
maintained. This creates a smooth flow of communication with supplier so that stock can is
available s proper quantity and quality. (Liu and Özsu 2018).
Decision Support System (DSS) - Decisions taken by owner or manager of business decides the
operations that are performed. It helps in developing strategies according activities that will help
in growth and development of business. DSS provides a platform for owner to make effective
decisions by analysing past data. It also provides alternatives to be taken in case of critical
situations. This is established at every level so that decisions can be integrated to achieve
common goal. With this, conflicts can also be solved thus improving employee performance.
CRM combined with DSS will be beneficial for business to solve customer problems and gaining
their trust. It will provide training to employees on how several decisions are taken to solve
different customer problems.
Expert Information System (EIS) - It is also known as knowledge information system that
analyses data to provide useful information while taking decisions. This helps managers to
improve their quality of decisions (Noble 2017). It works in similar way like a human brain but
difference is that its uses machines to process, store and analyse information. It uses Artificial
Intelligence (AI) to make a decision.
Customer Relationship Management (CRM) – It is system that stores customer’s information
like name, address, etc. to build strong relationship with them. This helps in solving their
problems and identifying needs. Moreover, it increases business efficiency in solving problems
and analysing change in taste and preference of customer. Therefore, with this the performance
of sales force can be measured thus, the quality of services can be improved. This will benefit
business in retaining customers and gaining market share.
M2 Analyse how IT system store and process data
The data is stores in various ways in different system. It depends upon the type of system
that is been used in organisation. For example- CRM will store data of customers related to their
name, age, problem faced, etc. This will help company to know about what are his demands and
changes that can be done in product (Pearlson, Saunders and Galletta 2016). It also analyses
4

behaviour of customer by communicating with him. CRM can be used to attract customers by
offering them extra services and benefits.
TASK 3
P4 How IT system supports changes within organisation
IT system brings transformation in business activities and operations. It allows managers
and employees to effective work together by integrating their efforts. It makes the process and
functioning of Johnson super market faster and efficient. This is main reason why IT systems are
implemented in enterprise. This enables departments to coordinate and communicate with each
other by sharing data and information in systematic manner. As these systems are based on
technology it is beneficial in long run as changes can be made in it according to change in
technology (Power, Sharda and Burstein 2015).
The implementation of DSS in Johnson super market will be beneficial for them to
enhance their productivity. Managers will be able to improve their quality of decision and
alternatives can be developed to use in critical circumstances. So, if there is change in market
condition then accordingly decision can be made. Also, this will enhance employees working
style as they will work with change. Furthermore, various departmental head will discuss with
each other to set goals and objectives. If each department is having this system they can take
independent decision on the basis of data. This process increases efficiency decision making
process of each unit that leads to overall business performance. Managers can take decisions
based on short and long goals. If decision works effectively in achieving short term goals then
business can focus on long term goals. Therefore, achieving short term goals will help in
improving overall business performance and productivity. In this way DSS supports change
within Johnson super market (Sekaran and Bougie 2016).
It directly affects thinking efficiency of managers. This is done to ensure that business
decision taken by managers is effective in achieving objectives or not. By implementing DSS,
enterprise performance is enhanced along with way of working of employees.
M3 Advantage and disadvantage of IT system
There are many pros and cons of IT system. It varies according to their effectiveness and
efficiency in business operations. IT system which is implemented in Johnson super market is
transaction processing system. The advantage of the system is that it prevents duplicity of data.
5

Also, it reduces order cycle time and inventory cost. On the other hand, it is a very costly system
to implement in business and is very difficult to understand its hardware and software
components.
TASK 4
P5 IT solutions for common business problems
Various problems are been faced by business every day. This affects the entire business
operations and its productivity. Therefore, it is essential to solve these problems for smooth flow
of business operations. Managers develop strategies that help in solving problems and ensure that
it does not happen in the future (Power, Sharda and Burstein 2015). The common problems are
discussed below:-
Forecasting- It is related to forecast sales so that profits can be estimated. Also, it helps in
preparing budgets by analysing performance of each department. IT systems analyse past data to
prepare budgets and forecast sales. It enables managers to develop strategies for expanding
business (Tao and et..al. 2017).
Problem solving- Conflicts are the major cause that affects organisation growth. It impacts
employee’s performance and behaviour. Managers should solve them to maintain better relations
among them. IT system provides manager to deal with it by giving suggestions. It gives them
information based on employees and provides tools to work effectively.
Supply chain- It is important to have a strong network of supply chain. It is because it creates
smooth flow of input and output. A break in link between them will affect the overall business
operations. Therefore, implementing IT system will develop an effective communication channel
between them. It will enable them to share information and data regarding goods or services.
Resistance to change- The implementation of new process or procedure resist employees to
adopt that change. It is because they do not want change in their way of working. So IT system
allows employees to adopt change by providing new methods or tools. With this work becomes
easier and it encourages employees to adopt change. Moreover, they are able to attain tasks in an
effective way (Liu and Özsu 2018).
Failure of plan- It is the most common problem that occurs in business. Planning is done by
managers to expand business operations. But sometimes these plans fail due to various reasons.
6

IT system will allow manager to make effective plans by properly analysing market conditions.
It will help in developing plans for different situations and also giving solutions in case of failure
of plan.
M4 How IT system add value to business problem
By implementing various IT system in business, several problems can be solved. It is
done to enhance efficiency in performance and productivity. This helps business to overcome its
weakness and compete in the market (Jones 2014). Also, it adds value to operations by making
it more effective. Furthermore, the efficiency of employees is increased due to implementation of
new methods and procedures. Their skills and abilities are developed that leads to achieving
goals in an effective way.
CONCLUSION
From this report, it is concluded that implementing IT systems helps an organisation to
improve its business operations. It is useful in increasing efficiency in overall business functions.
There are different IT systems used in business departments and that helps in taking effective
decisions to achieve goals and objectives is shown. In addition to this, Transaction Processing
System (TPS) and Decision Making System (DSS) in relation with Customer Relationship
Management (CRM) are analysed. Further, how some common business problems such as
problem solving, resistance to change, etc. can be solved by implementing different IT systems.
7

REFERENCES:
Books and Journals:
Avgerou, C. and Walsham, G. eds., 2017. Information Technology in Context: Studies from the
Perspective of Developing Countries: Studies from the Perspective of Developing
Countries. Routledge.
Aykin, N. ed., 2016. Usability and internationalization of information technology. CRC Press.
Boud, D., Cohen, R. and Sampson, J. eds., 2014. Peer learning in higher education: Learning
from and with each other. Routledge.
De Haes, S. and Van Grembergen, W., 2015. Enterprise governance of information
technology. Achieving Alignment and Value, Featuring COBIT, 5.
Jones, C.B., 2014. Geographical information systems and computer cartography. Routledge.
Liebowitz, J. and Frank, M. eds., 2016. Knowledge management and e-learning. CRC press.
Liggins II, M., Hall, D. and Llinas, J. eds., 2017. Handbook of multisensor data fusion: theory
and practice. CRC press.
Liu, L. and Özsu, M.T., 2018. Encyclopedia of database systems. Springer.
Noble, D.D., 2017. The classroom arsenal: Military research, information technology and public
education. Routledge.
Pearlson, K.E., Saunders, C.S. and Galletta, D.F., 2016. Managing and Using Information
Systems, Binder Ready Version: A Strategic Approach. John Wiley & Sons.
Power, D.J., Sharda, R. and Burstein, F., 2015. Decision support systems. John Wiley & Sons,
Ltd.
Sekaran, U. and Bougie, R., 2016. Research methods for business: A skill building approach.
John Wiley & Sons.
Tao, F., Cheng, Y., Zhang, L. and Nee, A.Y., 2017. Advanced manufacturing systems:
socialization characteristics and trends. Journal of Intelligent Manufacturing.28(5). pp.1079-
1094.
8